2022 (12) TMI 306 - HC - VAT and Sales Tax

Maintainability of petition - alternative remedy of appeal - Validity of assessment order - exemption of sales returns - HELD THAT - The petitioner would request that the petitioner be permitted to file an appeal before the statutory authority with all materials in support of its claim of exemption for sales return. Learned Government Advocate does not object to this submission which is also supported by an endorsement made by learned counsel for the petitioner on behalf of petitioner - the request is acceeded to. Appeal, if filed within a period of four (4) weeks from today, shall be admitted without reference to limitation but ensuring compliance with all other statutory conditions, including pre-deposit. Addition made on account of miscellaneous income - resale of software licence - rewards - freight charges and packing forwarding charges - HELD THAT - The assessing authority has not even bothered to advert to the explanation that has been set out and has rejected the same in a single line. Since the Court finds the explanation put forth by the petitioner tenable in law, the addition on this score is set aside - Petition disposed off.

Summary

Issues:
Challenge to orders of assessment under the Tamil Nadu Value Added Tax Act, 2006 for the periods 2013-2014 to 2015-2016.

Analysis:
1. Sales Return:
The petitioner claimed exemption for sales returns and provided evidence to justify the claim. The court directed the production of records to verify the receipt of information. However, the records were not found, and the petitioner requested to file an appeal with supporting materials. The court allowed the appeal to be filed within four weeks without reference to limitation but subject to other statutory conditions.

2. Other Income:
The assessing authority added miscellaneous income, packing and forwarding charges, rewards, freight charges, and resale of software licenses to the turnover. The petitioner argued that these amounts were based on All India figures and only the amounts attributable to Tamil Nadu should be considered. The petitioner provided a detailed explanation for each item, showing that they were not part of sales turnover and should not be taxed. The court found the explanation credible and set aside the addition on this basis.

In conclusion, the court disposed of the writ petitions in favor of the petitioner, allowing the appeal for sales returns and setting aside the addition of other income items. No costs were awarded, and connected miscellaneous petitions were closed.